Thursday, May 17, 2012

US Telecom Industry From 2010 To 2015

The U.S. telecom industry has been fast changing owing to numerous technological advancements. This research conducted by Axvoice looks at the U.S. telecom industry from years 2010 to 2015 and the different factors that are affecting it over this period of time. This research aims to provide a generic overview of the projections for the U.S. telecom industry by monitoring the current trends.

Background

The U.S. telecom industry has seen a major shift in the market share. During the last quarter of the twentieth century, landline phone services have ruled the planet. There hadn’t been any major change in trends witnessed then. However, during the last ten years, the change has been sudden and sporadic. The market has been shifting to modern telecom technologies that are more cost effective and convenient to use. This research looks at how each technology originally became popular and what place it holds in the future of the U.S. telecom industry.

Landline Phone Service

Fixed landline phone services have been the first type of phones ever available to public. This technology ruled the telecom industry in the U.S. and everywhere else in the world because there weren’t any obvious alternatives. The credit goes to landline phone services for connecting people when there was no such technology as internet. Although, one can argue that the rates of making phone calls then were pretty high, but still there did exist a means of telecommunication. Landline phones have seen the days of glory and trouble, both. Modern times predict that there is a decrease in the number of fixed landline subscribers every year in the U.S. There are several reasons why the decline has been so quick;

* The first reason is that fixed landline phone subscribers have a fixed line rent to pay which is quite high.

* With the availability of HD voice they lack the clarity of voice that other networks provide.

* They cannot be relied upon owing to their use of old copper wire technology.

* Lastly, they are not portable.

All these are the main reasons that contribute to declining use of fixed landline phone services. Here is how the trends reflect the future of landline phone subscribers from the year 2010 to 2015.

The overall number of fixed landline subscribers is expected to decrease over time. The research indicates that the total number of landline users is expected to reach from over 150 million in 2010 to around 135 million in 2015.

Cellular Networks

Cellular networks show a continuous increase in the number of customers. There have been several factors that influenced the growth of cellular networks. The number one factor has been convenience. Before cell phones, portability of a phone system was a farfetched dream. However, with the introduction of CDMA and GSM networks the shift has tilted in the favor of the cellular networks. New breed of cell phones (smart phones) aren’t mere devices of making and receiving phone calls, they can be used for storing data, taking pictures, sharing content and accessing the internet. Unlike the earlier versions of cell phones, modern smart phones can do a lot more for their users. The growth of the cell phone industry is poised to stay stable over the years. Market share of the cellular networks is expected to grow at a steady rate. The estimate of the future cellular network consumers is as follows.

The total number of subscribers is going to leap from 270 million in 2010 to around 460 million in 2015. The factors responsible for this growth discussed above include convenience, temptation for smart phones, and finding a viable alternate to fixed landline phone.

VoIP

VoIP or internet phone service has seen a lot of growth in recent years. There are many factors that have contributed to its explosive growth. The first major reason for VoIP growth is technological superiority. Unlike cellular phones and landlines, internet phones, as the name suggests, use internet to send and receive voice in the form of data packets. This digitization of voice not only significantly improves the quality of the phone calls but also improves the reliability of this service. Portability is yet another option only available to the internet phone service users. VoIP service can be used anywhere in the world by just connecting the phone to an internet connection. VoIP phone service can be used in several ways. Phone users can use it using the ATA, installing an app on smart phones, or they can even install the software on their PC. Cost is another factor that discourages people from using cell phones and fixed landlines. Internet phone services are very cost effective and offer many smart calling plans for both businesses as well as individuals which help them save a lot of money.

Comparative analysis

Here is a comparative analysis, analyzing the changes in market share of the US telecom from 2010 to 2015.

Year 2010

In the year 2010, cellular networks rule the market with most number of subscribers at 57%. The overall market share withheld by VoIP is just 12%. However, fixed landline services do hold substantial share of the market with just over 30% of the total subscribers.

Year 2011

In FYE 2011, fixed landline phone services have shrunk by 3% while the overall share of cellular networks increased by a mere 2%. However, total share of VoIP in US telecom remains the same. Total market share held by VoIP is 12%, fixed landline 29%, and cellular networks at 59%.

Year 2012

In 2012, cellular networks are expected to retain total market share at 59%. However, VoIP is expected to gain an added 4% increase. While, number of fixed landline subscribers is expected to shrink by 4%. Cellular networks is expected to remain at 59%, while VoIP is anticipated to have 16%, and fixed landline services to have 25% respectively.

Year 2013

VoIP is expected to retain its increasing trend, with a further rise of 4% anticipated. However, there is a slight decrease of 1% expected in the share of cellular networks. Fixed landline phone subscribers are also expected to reduce by a further 3%. VoIP’s total share will be around 20%, fixed landline phone subscribers at 22%, and cellular network at 58%.

Year 2014

In FYE 2014, VoIP providers are expected to see the biggest change so far by an anticipated increase of 6%. While fixed landline phone subscribers are expected to further reduce by 3%. Cellular networks are expected to have an increase of 1%. Cellular networks will be expected to have 55%, landline phone services 19%, and VoIP around 26% respectively.

Year 2015

The overall situation of telecom market share in the US would have changed by 2015. Fixed landline phone services would have lost majority of their market share to cellular networks and VoIP providers. Total market share belonging to fixed landline service providers is expected to be around 16% only. Cellular networks are expected to hold 52% share while VoIP would have a staggering 32% of the total phone subscribers market.